Debt & Credit
The avalanche and snowball methods, and when each is right
One pays less interest, the other is finished more often. The evidence on which works is not what the arithmetic suggests.
Beatriz Lima
Contributing writer, Finance Ridge
Beatriz covers debt, credit reporting and consumer protection.
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15 articles
Debt & Credit
What a credit file actually records, and what it does not
Credit scores are widely misunderstood, partly because the number most people see is not the one lenders use.
Investing
Dividends are not extra money appearing from nowhere
When a company pays out, the share price adjusts for it. Whether you want dividends is a question about tax and cashflow, not about…
Debt & Credit
APR, AER and the flat rate are three different numbers
Lenders quote whichever rate makes their product look cheapest, and the differences between the measures are not small.
Debt & Credit
Buy now, pay later is credit with the word taken out
Splitting a purchase into instalments is borrowing, and the differences from other borrowing are mostly in what protections apply.
Debt & Credit
Paying a debt early saves less when the interest was charged upfront
Some agreements accrue interest daily and some calculate it at the start, and the difference decides whether overpaying is worth…
Debt & Credit
Consolidation relocates debt without reducing it
A single lower payment can be a genuine improvement or an expensive extension, and the difference is visible in two numbers.
Debt & Credit
Guaranteeing a loan makes somebody else's debt yours
Joint and guaranteed borrowing carry obligations that most people signing them have not been told about clearly.
Investing
A fund is a legal container, and the container has consequences
Funds with the same holdings can sit in different structures. The structure decides pricing, protection and how you get out.
Investing
An exchange-traded fund trades all day, and that changes three things
Continuous trading is the defining feature. It affects what you pay, when you deal and how the price stays honest.
Investing
The spread is a cost you pay without ever seeing an invoice
Every trade has two prices. The gap between them is money that leaves your account without appearing as a charge.
Investing
Your name is usually not on the share register
Most investments are held through an intermediary. Understanding who holds what explains a great deal about your rights.
Debt & Credit
How much debt is too much is a cashflow question, not a total
The size of a balance says little on its own. What matters is what it demands from each month's income.
Debt & Credit
Borrowing to invest multiplies the outcome in both directions
Using borrowed money to buy assets magnifies gains and losses equally. The asymmetry is in what happens when it goes wrong.
Debt & Credit
A payment holiday moves the interest, it does not remove it
Pausing payments can be the right thing to do in a crisis. It is not free, and the cost appears later.